Nikkei Dips below 49,000; Key Long-Term Rate Hits 17-Yr High

Tokyo, Nov. 18 (Jiji Press)–Japan’s benchmark Nikkei 225 stock average slipped below 49,000 on Tuesday, while the key Japanese long-term interest rate hit the highest level in over 17 years. The Nikkei index ended down 1,620.93 points, or 3.22 pct, from Monday, at 48,702.98, finishing below 50,000 for the first time since Oct. 24. A wide range of issues were caught up in profit-taking that hit the Tokyo market, amid a risk-averse mood among market participants in response to overnight declines in U.S. shares. Issues related to artificial intelligence and semiconductors, in particular, bore the brunt of the waves of selling. Ahead of U.S. semiconductor giant Nvidia’s earnings announcement on Wednesday, some investors “have started to become skeptical about the profitability of AI-related companies,” an official of a major securities firm said. Meanwhile, concerns over Japan’s fiscal condition, due to the economic measures proposed by the administration of Japanese Prime Minister Sanae Takaichi, overtook the Japanese bond market on Tuesday. The yield on the most recent issue of 10-year Japanese government bonds, Japan’s key long-term interest rate, hit 1.755 pct at one point in interdealer trading, the highest level since June 2008. A group of lawmakers from the ruling Liberal Democratic Party urged Takaichi to secure over 25 trillion yen for general-account spending under a fiscal 2025 supplementary budget. An official of an asset management firm said, “Concerns over fiscal expansion have not been alleviated.” Such concerns also led to the yen succumbing to selling during Tuesday’s currency trading. The dollar briefly rose to approach 155.40 yen in the morning, prompting Finance Minister Satsuki Katayama to express her concerns over the “extremely unilateral and rapid moves at the moment.” At 5 p.m., the dollar stood at 155.00-00 yen, up from 154.68-69 yen at 5 p.m. Monday. The euro was at 1.1591-1592 dollars, down from 1.1614-1614 dollars. After the euro hit 180 yen for the first time ever in New York trading, it stood at 179.67-69 yen in Tokyo trading at 5 p.m. Tuesday, up marginally from 179.64-65 yen at the same time the previous day. END [Copyright The Jiji Press, Ltd.]